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The Key To Risk Management: Management, Adrian E. Tschoegl
The Key To Risk Management: Management, Adrian E. Tschoegl
Adrian E Tschoegl
The Barings, Daiwa Bank and Sumitomo Corp. financial debacles in the mid-1990s suggest that management failures rather than misfortune, errors, or complexity are a major source of the risk of financial debacles. These errors are systematic and are a concommittant of the structure of trading and of human nature. Risk management systems must take these facts into account. Two years after this chapter first appeared in the first edition, John Rusnak, a trader at Allied Irish Bank’s US subsidiary lost US$691m in unauthorized trading.